APAC leads global retail growth with 5% real spending rise

APAC is the most balanced omnichannel region globally, with store-based retail sales projected to grow 20.4%.

Despite macroeconomic headwinds, the Asia Pacific (APAC) region continues to lead global retail expansion, with real retail spending growth averaging 5% YoY, according to Colliers’ latest report.

The region is expected to maintain this momentum through 2026, bolstered by robust domestic demand, tourism recovery, and rising middle-class consumption.

Whilst the pace of growth dipped by 0.7 percentage points between 2023 and 2024, the report notes that APAC remains the fastest-growing retail market globally, ahead of the Americas and Europe.

Notably, stimulus in mainland China, along with tourism-led spending in Japan and Singapore, and population growth in Australia, are offsetting weakness from China’s broader economic slowdown.

Colliers flagged geopolitical uncertainty and U.S. tariff risks as key challenges for the region’s outlook in 2025–26. However, bilateral deals in Japan and South Korea, along with expected rebounds in discretionary spending, are likely to mitigate some of these pressures.

In terms of retail channels, APAC is the most balanced omnichannel region globally, with store-based retail sales projected to grow 20.4% from 2024 to 2028, alongside 43.4% growth in online and digital sales.

The shift to digital is seen as complementary, not cannibalistic, to physical retail. Asia’s e-commerce market, valued at US$1.97t, boasts the fastest five-year growth rate globally (9.8%).

The report highlighted the region’s digitally native consumers, particularly in markets such as China, Thailand, India, and Indonesia, where social commerce platforms like TikTok Shop are driving rapid growth.

Structural tailwinds from a growing middle class also support long-term retail growth. Over the past decade, APAC added 332 million middle-income households, with another 352 million expected by 2034, largely concentrated in China and India.

Investor sentiment is also improving. Retail assets now comprise 40% of APAC’s cross-border capital flows, up from 15% a year earlier, indicating a return of capital to the sector amid improving fundamentals.

By category, food and beverage is forecast to lead spending in 2026, with 7% real growth, driven by persistent dining-out habits and strong food cultures in cities such as Singapore, Hong Kong, Bangkok, and Taipei.

Household furnishings and clothing, and footwear are also expected to post steady gains of 5% and 4%, respectively.